Question

In: Economics

Case 4.1 Catastrophe In Bangladesh 1. Do American consumers who wear clothing produced in countries like...

Case 4.1 Catastrophe In Bangladesh

1. Do American consumers who wear clothing produced in countries like Bangladesh bear some responsibility for the wages and conditions of workers there? Do they bear some responsibility for the Rana Plaza collapse? Many consumers know or at least suspect that the clothes they wear are made in third-world sweatshops. Does this affect their moral responsibilities?

2. Do companies whose clothing was being made in Rana Plaza have an obligation to help the victims or their families? What about companies who have had clothing made there in the past, but not at the time of the collapse? Dan Rees suggests that even garment companies with no association with Rana Plaza should contribute out of solidarity with the industry. Explain why you agree or disagree with this.

3. In your view, are Western companies sincere about trying to improve factory safety, or is it just a public relations effort?

Solutions

Expert Solution

1. In my personal opinion, yes the consumers who are wearing clothing made in Bangladesh also bear some moral responsibility for the wages and conditions of the workers working there, After all, the companies only provide what the consumers want (while also chasing to increase the profits, of course). If the consumers are demanding lower prices, then companies will find vanues and conditions which allow so. Of course this is only one pillar of it, the other pillar is the ever insariable chase for higher profits (and lower costs are a big part of that).
So if customers, especially those who are in some capacity aware of the conditions, demand that the conditions be made better for the workers or there will be financial consequences, the companies would listen in the end. In my opinion usually the customers abdicate all the blame to the companies, which is wrong.

2. Yes, definitely. The companies whose clothing was being made there have the obligation to help the workers and their families. These are the companies who shifted there and chased lower costs. This chase for lower costs, from both the company and their local contractors, resulted in the conditions which resulted in the collapse. There is a direct relation and hence they definitely have the obligation.

The companies who were there at some point but are no longer getting their clothing made, have only voluntary obligation in my personal opinion. There can be various reasons why some of them left that contract. It might include the bad working conditions too. It might also be even lower costs at some other place. Its tough to know and hence tough to assign blame too. So here I would say that they definitely can help the workers and that would be a good thing to do, but I will assign a mandatory obligation to it.

3. I do not think that the western companies are sincere regarding this. Their main aim remains to increase the shareholder value and in that direction they work. Such a big disaster could not have happened if the companies had more stringent rules for their contractors and regular and thorough inspections. It is always after such a disaster that the companies announce a slew of new measures, which also often get neglected after a while. Also, a lot of cost advantage is wasted if developing countries also start keeping standards at the western level. So this is contradictory to why the companies went there in the first place (lower costs) and hence I dont think they are really sincere.


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